Cookson unveils restructuring plans

WIDE-RANGING restructuring is imminent at one-time FTSE 100 metals technology group Cookson, the company revealed today. Cookson is to sell off more than £100m of non-core businesses and focus on its electronics, ceramics and precious metals operations.

New chief executive Nick Salmon, who joined the company last July after being ousted from French engineering giant Alstom, said he was very confident that the new strategy would help reduce debt and return value to shareholders.

Salmon said the company hoped to start paying dividends 'as soon as possible' after improving the performance of Cookson's core divisions.

The outlook for Cookson remains steady. In a fourth-quarter trading statement issued alongside details of the strategic review today, the company said that pre-tax profits before exceptional costs for the year would be in line with forecasts and the new year had been 'solid' so far.

Analysts have pencilled in pre-tax profits of between £87-£90m for the year as a whole. Cash generation remains positive with a strong performance in the fourth quarter contributing to a reduction in net debts.

Cutting debts has been one of Salmon's key priorities ? at the end of September the group's debts stood at just over £400m. Restructuring has seen Cookson cut some jobs at its electronics operation in the US and reduce capacity at one of its laminates factories in Germany. These moves will see the company incur an £8m exceptional charge.

Another £18m exceptional cost arises out of a re-evaluation of its interest in a fibre-optic cable network in the US between Portland and Los Angeles.

Cookson will also write off £8m in goodwill after selling two underperforming businesses in its ceramics division late last year.